Cellini trial continues

Annie Sweeney, Tribune reporter

A small but key group of people involved in the Illinois Teachers' Retirement System had gathered for a meeting in a Chicago office building in February 2004.

TRS Executive Director Jon Bauman and board member Stuart Levine were already there, but longtime Springfield power broker William Cellini, who had made millions of dollars from investing funds for the pension system, was running late.

When Cellini arrived, he had warm welcomes — and a hug and a kiss on the cheek for both Bauman and Levine — as well as a story to tell, according to testimony Tuesday during the third day of Cellini's federal trial on charges of fraud and attempted extortion.

Testifying for the government, Steven Loren said Cellini indicated he had met with top advisers to then-Gov. Rod Blagojevich to warn them they were "moving too fast" and were "going to get themselves in trouble." Cellini said he went on to tell the advisers, Antoin "Tony" Rezko and Christopher Kelly, that they should use "Bill Cellini as an example," according to Loren, who was a lawyer for TRS at the time. Cellini then related to them how in his 30 years in politics he had stayed "above the fray" and "out of the limelight."

Cellini is now defending himself on charges that he worked with Levine, Rezko and Kelly to try to squeeze a campaign contribution for Blagojevich's campaign from a Hollywood producer whose investment firm had substantial TRS business.

Loren testified for about five hours about how Levine and Cellini plotted with Rezko and Kelly to protect their influence with TRS.

Prosecutors hope Loren's testimony will be important corroboration for Levine, the government's key witness, whose credibility is a central issue for the defense. Levine — who like Loren has pleaded guilty in the scandal — could take the witness stand as soon as Wednesday.

Loren testified that Levine had asked him to help defeat a proposal to merge several state pension boards, a move that would have diluted the power Cellini and Levine held at TRS. Loren said Levine told him he showed Cellini a rough draft of some talking points on the issue prepared by Loren. Cellini thought the ideas looked good but for one minor tweak — the font should be changed, Loren said.

Loren also talked about how during a car ride with Levine in October 2003 — the last Friday of the month, he repeatedly recalled — he agreed to help Levine prepare a sham finder's fee for a man who did business with the state.

In that same conversation, Levine explained to Loren that Cellini, Kelly and Rezko had talked about how they would use these sham finder's fees to reward Blagojevich campaign contributors and that in return, Rezko and Kelly would not interfere with the selection of investment companies for TRS.

Loren endured a lengthy cross-examination by Cellini's attorney, Dan Webb, who prodded him about his role in the scandal, what other "acts of dishonesty" he committed and his friendship with Levine, who in testimony in Rezko's 2008 trial admitted to drug binges.

Loren testified that he considered him a close friend but realizes that Levine kept secrets from him. Webb asked Loren whether Levine shared details about "his all-night drug parties."

His head down, Loren said no.

While U.S. District Judge James Zagel blocked some of Webb's questions, Loren admitted he had fudged billing records in an unrelated case.

Webb also questioned Loren about an FBI interview in 2004 in which Loren had apparently left out Cellini — mentioning only Rezko and Levine — in connection with the sham finder's fee scheme.

Loren said he couldn't be sure if the agent took down his words correctly. But in testimony Tuesday he said he was certain about the conversation he had with Levine that Friday.

"I haven't worked since July 2005," said Loren, explaining the toll that the case has taken on him. "There are certain things you are just never going to forget. And that's one of them."